A lot of states are forming policies that can help them address fiscal deficits due to the coronavirus pandemic. It has also helped states fast-track the legalization of sports betting in certain states. For others, it has allowed easier access to sports betting via betting software as opposed to venturing out to retail sportsbooks. However, the Massachusetts Senate removed sports betting in its economic development bill. Their House has other ideas, and are including sports betting in its economic development bill. The catch? Massachusetts wants and Integrity fee in sports betting.
As it stands, states will be able to generate income from taxing sports betting activities. States can get an around 10% for instance, of betting revenue. They can also earn from the licensing and accreditation fees from operators who will register with the state. This is why sports betting is a popular option for states to be able to collect income for the state coffers.
Integrity Fee in Sports Betting
An integrity fee has been a previously-dismissed idea by the industry. Initially, sports leagues and teams wanted to get a cut from sports betting revenue. Sports betting, after all, would not be there without them. But gambling operators are arguing that these teams and leagues get more viewership, more attendance, sales merchandise, and more, from the sports betting market. So far, the Patriots, or the league, has not asked for this to be included in the bill, so the source of this added fee is unknown.
If this happens, this will mean that 1% of the gross revenue will go to the owner of the venue where any betting event will take place. With all the expenses and fees concerned, this is a big deal for sportsbooks. Except, of course, for pay per head bookies, as their fees are fixed at a regular rate. While the effort to legalize sports betting is laudable in Massachusetts, adding an integrity fee is not a good way to encourage gambling operators to participate in the local betting market.